The International Energy Agency expects to see electric vehicle sales of around 14 million by the end of this year. Governments across the world are trying to increase EV popularity. National policies and incentives will likely help with sales.
The U.S. expects to deliver a 50% market share for electric cars by 2030. The European Union has adopted similar standards that are in alignment with the 2030 goals. Global spending on electric cars is set to increase in the coming years, increasing competition.
However, every EV company may not achieve success. As a smart investor, you should be able to identify which EV companies are your safest bets. Now is the time to start loading up on the top EV stocks.
Tesla (TSLA)
Unquestionably, Tesla (NASDAQ:TSLA) is one of the top EV stocks, with recent premium trading at $253, up by 145% year to date.
The favorable market environment and latest earnings season have given a boost to several industry stocks. And Tesla is no exception. Recent financial results reveal a revenue of $24.9 billion and an EPS of $0.78. Additionally, it produced 480,000 cars in the quarter, up 86% year over year.
Due to rising inflation, the management cut car prices of cars which led to a drop in the company’s gross margin. However, this could be temporary; we may see improved reports of better gross margins in the coming quarters. The company has opened its charging network for other EV makers thereby entering into partnerships with several EV companies over the past month.
Tesla is about to expand into India and building up its manufacturing capacities. The company is also focused on building fully self-driven cars and investing heavily into R&D. With a leader like Elon Musk, a lot is working in favor of Tesla. This is one EV stock to own and hold this decade for high growth.
Li Auto (LI)
The second strong EV company pick is Li Auto (NASDAQ:LI).
Performing consistently even during periods of high inflation, LI stock investors holding shares since mid-2022 have made significant gains. The stock is trading at $45 currently, up 118% year to date.
Known to thrive in chaotic market situations, the company saw 201% growth in Q2 deliveries and managed to launch new models. LI heavily invests in intelligent systems, vehicle design, and technology.
In addition, it will launch the Li MEGA model in this year’s fourth quarter and steadily gaining strength in the Chinese market. This 500,000 yuan-priced model could help increase the market share. Enjoying strong government support, it achieved a whopping 227% year-over-year rise in July deliveries (34,134 vehicles) and a total of 173,251 in 2023.
Currently, a leader in the Chinese EV space, the company has set an ambitious target of delivering 40,000 cars each month for the fourth quarter. Li Auto is set to report results on August 8 which may soar the stock higher. If you want to invest like a billionaire in EV, consider Li Auto.
BYD Co. (BYDDF)
One of the top billionaire’s EV stock picks and backed by Warren Buffet, BYD Co. (OTCMKTS:BYDDF) has been giving heavy competition to Tesla. The automaker already holds a position of brawn in the Chinese market and enjoys a global presence. Q2 delivered more than 700,000 new energy vehicles with half of them fully electric, beating Tesla’s delivery numbers.
In addition, as the second-largest EV battery supplier with strong financials, BYD’s Blade Batteries are high in demand across the industry. The batteries are favored by EV makers for their high performance and durability. In July, the company reported deliveries of 262,161 units, up 3.6% from June. It also managed to break the monthly sales record for the third consecutive month.
BYDDF stock was trading at $34 recently, up 33% year to date. This cheap stock appears undervalued currently. The company’s steady expansion and consistent delivery numbers proves its potential to meet future rising demand.
On the date of publication, Vandita Jadeja did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.